Aereo Wins Round One Against Broadcasters; Judge Rejects Injunction & Allows Service To Live

from the how-do-you-define-your-antenna dept

We've been covering the ridiculous legal fight over Aereo for a few months now. If you don't remember, Aereo is a company that offers -- for a fee -- to let people watch over-the-air broadcast TV (not cable, so just the small number of broadcast stations) online. Basically, what they do is set up antennas in a building in Brooklyn -- with one antenna per customer -- and then connect that antenna to the internet so the person can watch. The TV broadcasters flipped out and sued.

As we've noted, in essence, this is another lawsuit that asks the question: do the copyright rules change depending on the length of your cable. That is, we know that it's legal to put up an antenna yourself and watch what you get. That's how broadcast TV works. We also know that it's almost certainly legal (it hasn't directly been tested) to take the legal TV you are accessing and then place-shift it so you can watch it over the internet (like with a Slingbox). So, if you combine those two things, why would it suddenly be illegal? The only real difference is that the antenna and the place shifting device sit in Aereo's building rather than in your own home. So, it's just that the "cable" length between the users and the devices is longer. Why should the length of the cable determine whether something is infringing or not? In a few related legal cases, the rulings have been mixed.

There was the ivi case, where the company offered a very similar service, but went with a different legal theory (relying on compulsory licensing rules)... which has so far been shot down in court. Then there was the Zediva case which relied on a very similar theory, but with DVDs (i.e., the company had a separate DVD player for each customer and let you watch movies streamed from that individual player). In that case, the court issued an injunction and the company shut down. Finally, there's the Cablevision ruling in which the TV guys went after Cablevision for offering a remote DVR feature. In a somewhat convoluted, but important, ruling, it was found that a remote DVR could be legal and non-infringing.

While the networks seriously argued that anything that caused anyone to think about cancelling their cable subscriptions could be illegal, the judge in the Aereo case, Alison Nathan, has refused to grant a preliminary injunction (basically doing the opposite of what happened in the Zediva ruling). Zediva was in a different court (and only reached the district court level anyway) so that ruling had little direct influence here. The Cablevision ruling, however, was pretty clearly instrumental in saving Aereo from being shut down.

Much of the ruling focused on what seems like a relatively tangential question: whether Aereo is really creating an individual antenna for each customer, or if it's just building a giant single antenna. More or less, it's a question of whether or not each individual antenna works with the others to better capture the signal. This is also known as a totally stupid debate. I mean, if you were to step back and just look at this from a common sense standpoint, you'd say the fact that Aereo has to set up a different antenna for each customer is pretty stupid. There's no technical reason to do so, only a legal one. It is an expense that serves only to satisfy a legal demand, which is by definition an inefficiency introduced into the market for no reason other than to keep lawyers happy.

But, here, the judge ruled that the individual antenna theory applies, and thanks almost entirely to the Cablevision ruling, there's no reason to issue a preliminary injunction. The networks tried some bizarre theories about why Cablevision didn't apply, but the judge saw through all of the attempts at misdirection:

Despite this creative attempt to escape from the express holding of Cablevision, for the
reasons discussed below this Court finds itself constrained to reject the approach Plaintiffs urge.
Contrary to Plaintiffs' arguments, the copies Aereo's system creates are not materially
distinguishable from those in Cablevision, which found that the transmission was made from
those copies rather than from the incoming signal. Moreover, Plaintiffs' attempt to distinguish
Cablevision based on time-shifting fails when confronted with the reasoning of that case,
particularly considering that the Second Circuit's analysis was directly focused on the
significance of Cablevision' s copies but did not say one word to suggest that time-shifting played
any part in its holding.

From there, the ruling goes into a wonderfully thorough debunking of the networks' attempt to ignore the ruling in Cablevision and a detailed explanation for why Aereo is quite similar to Cablevision. In the end, the judge also bars the preliminary injunction due to the lack of irreparable harm if the service keeps going for the duration of the trial. The court actually says that it can see how there is a clear case that the networks could suffer irreperable harm, in the form of losing viewers and advertisers -- but that since that "harm" is a longterm one, there's little reason to issue an injunction right now. Separately, the court recognizes that an injunction would almost certainly be "irreparable harm" for Aereo, as it would effectively be a death sentence (as was the case with Zediva). Either way, however, the level of detail the court uses in laying out why Aereo is so similar Cablevision does not bode well for the networks' overall case.

This case is far from over, but in round one, the networks' key argument appears to have taken quite a beating.